Trading Simulation Assignment

Your Name: Your Student ID: Your JMU username: Trading Simulation Assignment 1.0 Introduction Foreign exchange trading has gained a lot of popularity in the twenty first century, where it has grown to the worth of over USD 3.5 trillion. This has attracted many investors, who are interested in earning returns on their investment…

Introduction

Date Trade Currency Contracts Maturity Price 9/2/2012 Buy GBP/USD 10 March 2012 1.5854 15/2/2012 Sell GBP/USD 10 March 2012 1.5765 15/2/2012 Buy GBP/USD 10 March 2012 1.5685 16/2/2012 Sell GBP/USD 10 March 2012 1.5765 19/2/2012 Buy GBP/USD 10 March 2012 1.5835 19/2/2012 Sell GBP/USD 10 March 2012 1.5860 1.1 Analysis of portfolio value and risk of the portfolio. This report a delineation of trading including strategies adopted, but before this, so as to effective mitigates the risk of earning high losses or losing considerable amount of profit due to speculation behaviors. There was need to establish stop loss point at $1.5650 and the take profit point as $1.5900. Having specified the spot loss point together with the take profit, this acted as the bench mark in trading so to manage my portfolio effective and avoid cases where I incur excessive losses. This implied that, in order to ensure the value of the portfolio does not follow below the pre-specified rate, constant evaluation of information and other factors that would affect the value of the portfolio were critically analyzed as delineated in the by the daily monitoring of the market below. ...

There must be: three alternative working capital policies which reduce future difficulties; a recommendation on policy and an evaluation of risk associated with the recommendation; contingencies for the recommendation; performance measures used to evaluate the recommendation; an implementation plan for the recommendation; a discussion and explanation of the recommendation; a review of the cash…

Policy Recommendation Lawrence Sports has created a strategic alliance with Central Bank with intent to receive credit facilities in times of cash deficit. According to this policy, money is automatically transferred from the Central Bank to Lawrence Sports’ account whenever the company experiences a cash deficit. Currently, the company’s line of credit with Central Bank has reached its limit,…

With high profits almost assured and reduction of losses to a minimum, many traders have started using HFT. In a way, HFT represents the inevitable move to high technology. Like many other areas of business processes such as procurement, automatic ordering in supply change management, ERP systems, humans are removed from decision-making and power is vested in machines. However, the process must be…

A portfolio once built and left alone is of no use. Hence, I have decided to carry out a trading simulation and an in depth analysis of the four companies that have been chosen by me. As all four of these companies provide different products and services, it is almost obvious that different returns are expected from each of these companies. Although the portfolio had been developed keeping in mind…

SU14), this report provided a clear rationale on why the trader chose to “buy” or “sell” and/or “put” or “call” in each of the completed trade. In most cases, the use of fundamental analysis alone is not sufficient in terms of enabling the trader to accurately determine where the price level of each trade will be heading. Therefore, each trade decision was made based on both…

Diversification of investment spreads the risk over many assets. The concept of Efficient Market Hypothesis (EMH) states that since the stock prices reflect all relevant information in the market, it is not possible for the investor to beat the market by purchasing selling stocks at inflated prices or purchasing undervalued stocks. Thus, in order to beat the market the investor will have to be…

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